Alaska Department of Natural Resources

1 Alaska Department of Natural ResourcesNatural ResourcesSOUTHEAST CONFERENCEMARCH 9, 2011 Overview DNR Background Engagement Tour Alaska s Opportunities and Challenges DNR s Role in Southeast Development2 Who We Are and What We Do Article 8, Section 1 of the Alaska Constitution provides that it is the policy of the State to encourage the settlement of its land and the development of its Resources by making them available for maximum use Resources by making them available for maximum use consistent with the public interest. Article 8, Section 2 provides that the legislature shall provide for the utilization, development, and ti f ll tl b li t th conservation of all Natural Resources belonging to the State, including land and waters, for the maximum benefit of its people.

2 PpDepartment Mission To develop, conserve and maximize the use of Alaska s Natural Resources consistent with the public interestWhat We Do DNR manages:g (1) the state s land approximately 100 million acres of uplands 60 million acres of uplands, 60 million acres of tidelands, shore lands, and submerged lands, and 40,000 miles of coastlinecoastline (2) the state s vast energy and Natural Resources (3) SE lands mostly federalEngagement Tour Meeting with key stakeholdersgy What I m hearing, seeing, learningg,g,g Challenges OpportunitiesNd f hi Need for partnershipSome Key Challenges Arrest TAPS throughput declinegp Continue momentum on a gas pipeline Ensure safety of aging infrastructureygg Address high energy costs throughout the state Fostering SE resource development mining, timber, gpg.

3 And hydro under federal control Increase permitting efficiencies and decrease backlogOpportunities Alaska as a Storehouse North Slope remains a world class energy basin Massive mineral deposits and water particularly in SESE Vast amounts of renewable Resources Vast amounts of renewable Resources New players looking to unlock our resource potential New players looking to unlock our resource potential Ongoing innovationggAlaska as a Storehouse Oil: 43 billion barrels of undiscovered, technically recovery reserves; this does not include massive quantities of unconventionals (shale, heavy oil, etc.)

4 Gas: 236 trillion cubic feet of undiscovered Gas: 236 trillion cubic feet of undiscovered, technically recoverable reserves Coal: 17% of the world s coal Resources ; 2nd most in 7;the world Copper: 6% of the world s copper Resources ; 3rd t i th ldmost in the world Lead: 2% of the world s lead Resources ; 6th most in the worldthe worldAlaska as a Storehouse Gold: 3% of the world s gold Resources ; 7th most in the world Zinc: 3% of the world s zinc Resources ; 8th most in the worldthe world Silver: 2% of the world s silver Resources ; 8th most in the world Rare earth elements: Alaska has over 150 occurrences Timber: Alaska has 17% of the nation s forestland Water.

5 About 40% of the country s fresh waterImportance of Partnership Stakeholders eager to form alliances Partnership moves projects forward BTC Pipeline Kensington Missing one key Obstruction Projects delayed or derailedjy Substance and process Forest Service economic transition plan Opportunities foreclosed Jobs lost and investment climate chilled Hurts Alaska s economic future Undermines national security and energy security Alaskans should voice frustration But we will redouble cooperation effortsDNR s Role in SE Development Permitting important for large and small projectslhl Survey geology , rare earth elements Cooperate with Forest Service on timber sales The state Tongass Team is working to ensure coordination between state agencies and provides comment on various Forest Service timber sale planning projects to push for full implementation of the 2008 TongassLand Management Plan implementation of the 2008 TongassLand Management Plan (TLMP)

6 Analyzing recent federal court roadlessdecision Analyzing recent federal court roadlessdecision Manage state forestsDNR s Role in SE Development In 2010, via a Governor s Office sponsored bill, the legislature established the first units of the SSE State Forest (25 291 acres) to help established the first units of the SSE State Forest (25,291 acres) to help stabilize and diversify a timber supply for sawmills and related businesses in SETh G h f lld l i h d ddi i The Governor has followed last year success with a proposed addition to the State Forest of 23,181 acres with HB-105 and SB-44 The state will invest in pre-commercial thinning to speed the growth The state will invest in precommercial thinning to speed the growth rate and quality of young growth timber on state forest lands DNR has worked to promote wood energy opportunities in SE DNR appreciates SE Conference and Shelly Wright s supportDNR s Role in SE Development Office of Project Management & Permitting (OPMP) jgg() strong record on permitting Greens Creek Mine (Hecla Mining Co.)

7 Kensington Mine (Coeur Alaska Inc ) Kensington Mine (Coeur Alaska Inc.) NiblackCopper-Gold-Zinc-Silver property (Heatherdale NiblackCopperGoldZincSilver property (HeatherdaleResources Ltd.)State at a Crossroads: Bright Future TAPS decline arrested North Slope gas brought on-line Increase hydro power in SEMi i dti il di REE d i i SE Mining production, including REE, and processing in SE Increase economic contribution from forest lands Renewable Resources meet state s growing energy needsRenewable Resources meet state s growing energy needs Rural Alaska : jobs up & energy costs down New markets for our Resources Value added industries Choose Respect State at a Crossroads.)

8 Bleak Future TAPS throughput decline accelerates Aging infrastructure failures hamper operations Major energy companies leave the state No gas pipeline Existing mines exhausted and no new mines brought on-liline Crushing energy costs Importation of LNG to meet Railbeltenergy needs Importation of LNG to meet Railbeltenergy needs Federal overreach transforms state into a national park State population declinesState population declines